The purpose of this study is to explore some possible measures for the Korean cotton textile industry to make further progress in the future, by way of reviewing the historical development of the industry and examining the problems currently facing the industry. The analysis is also focused on its relationship to the development of the world cotton textile industry.
Modern cotton textile industry which was initiated in England during the latter part of the 18th century was, later on, introduced to the other European countries such as France and Germany, the United States and Japan. The industry had done the leading role in the industrial revolution of each of these countries.
The Korean cotton textile industry which had been based on self-sufficient home-made handicraft production transformed, since the latter part of 1910's, into modern factory manufacture with the introduction of Japanese capital. The Japanese industrialist established cotton textile factory in Korea in order to take advantage of the cheap resources including labor and aimed at the expansion of their market. The industry expanded rather rapidly, during the invasion of Manchuria and the World War 11, to accommodate their military supplies.
The division of the country, following the liberation from the Japanese rule in 1945, caused turmoils and seriously disturbed the Korean economy. The industry which was relatively advanced, on account of her unique economic characteristics and important role in the national economy, was privileged receiving protection and assistance by the government. The industry grew rapidly to almost reach the pre-World War II level of production until the outbreak of the Korean conflict in 1950. About 70 percent of her facilities were destroyed due to three years of the Korean conflict.
Effort to rebuild the industry, namely rehabilitation and reconstruction plans-both short term and long term-took place immediately after the ceasefire in 1953 between the industry and the government. The plans were completed by 1957. Toward the end of 1950's, the growth of the industry slowed down due to stiff domestic demand, tighter fiscal and monetary policies, financial difficulties caused by the policy of abolishing low exchange rate and rapid growth of competing industry, namely man-made fiber textile industry sector.
During the 1960's, however, the status of the industry which began as import substitutes finally grew up to become major exporter. The industry kept up its status as the leading exporter in the Korean economy throughout the 1970's. Turing to the 1980's, the industry is confronting with seriously stressful problems and, therefore, readjustment of the industry became inevitable.
The problems encountered may be classified into two groups as internal and external. Internal problems include : (1) obsolete facilities (2) low rate of improving productivities (3) insufficient adoption of small lot production system (4) unsatisfactory rationalization in the acquisition of raw materials (5) high labor factor cost (6) high energy cost (7) insufficient investment for R & D and (8) incoherent domestic distribution system. External problems include : (1) decrease in demand resulting from sustained stagnation of the world economy (2) imposition of import restriction by the developed countries (3) competition from the less developed countries.
The primary emphasis to be placed on, in order that the Korean cotton textile industry may be able to become more competitive by overcoming numerous problems mentioned above, is to diversify the products and to improve the quality of products.
The demand outlook for the textile products, however, is promising in the long run, on account of population growth, increase in income and subsequent rising standard of living. Consumption pattern is also gradually everting to a preference for natural over chemical fiber. The cotton textile industry in general is, thus, expected to expand in the future. The Korean cotton textile industry in particular, however, may still face difficulties due to the problems mentioned above.
Therefore, some measures are proposed on behalf of the farther development of the Korean cotton textile industry as follows :
First: Modernization of production facilities.
Second: Improvement of quality and diversification of products through technical innovation.
Third: Systematic acquisition of raw materials such as raw cotton and chemical fiber.
Fourth: Reinforcement of competitiveness by enhancing productivity and thereby lowering production cost.
Fifth: Coherent coordination of domestic marketing channels.
Sixth: Further diversification of overseas markets.
Seventh: Promotion of public relations through combined efforts between the industry and the government to cope with the problems of import restriction.
Eighth: Increase of overseas direct investments in order to divert from import restriction and to explore third country markets.